Net income may rise 16 percent to 50 billion yen ($507
million) in the year started April 1, the Tokyo-based company
said in a statement. That compares with the 66.4 billion-yen
average of 18 analyst estimates compiled by Bloomberg.

Hirai used job cuts, asset sales, a weaker yen and
blockbuster movies to return the company to profit after four
years of losses as the electronics business struggles to keep
consumers from migrating to Samsung products. The South Korean
company’s smartphones outsold Sony’s 7-to-1 last year, and its
flat-panel TVs generated more than triple Sony’s revenue.

“Sony is being bullish,” said Takashi Oba, a senior
strategist at Okasan Securities Co. “It’s up to whether it can
reduce the losses in its electronics business and produce hit
products.”

Sony posted a profit in the year ended March after it
generated about $2 billion in one-time gains selling stock
holdings and properties including its New York headquarters, a
chemicals unit and shares in health-care data provider M3 Inc. (2413)
Sony’s movie studio also topped the U.S. box-office last year
with hits including “Skyfall” and “The Amazing Spider-Man.”

Operating Profit

Sony fell 1.4 percent to close at 1,744 yen in Tokyo
trading before the announcement, trimming its gain this year to
82 percent. Japan’s benchmark Nikkei 225 (NKY) Stock Average has
gained 37 percent this year. The company’s German shares fell as
much as 2.4 percent. Its American Depositary receipts rose 0.8
percent to $18.08 in New York trading.

Net income last fiscal year was 43 billion yen, the company
said yesterday. Operating profit may rise to 230 billion yen,
Sony said, compared with the 208 billion-yen average of analyst
estimates. Sales will increases 10 percent from a year earlier
to 7.5 trillion yen, it said. That compares with the 7 trillion-yen average of analyst estimates for revenue.

The TV business, the world’s third-largest, was
unprofitable for a ninth straight year with a loss of 69.6
billion yen, excluding charges, amid sluggish demand and
competition from Samsung and LG Electronics Inc. (066570)

Sony’s share of revenue in the market for flat-panel TVs
fell to 7.8 percent compared with 27.7 percent for Samsung,
according to Santa Clara, California-based DisplaySearch.

Profit Target

Sony expects to sell 16 million TVs this fiscal year, up
from 13.5 million, as it focuses on ultra-high definition
screens that offer resolution four times sharper than
conventional models.

“I don’t know how Sony would be able to spur TV sales to
16 million,” said Makoto Kikuchi, chief executive officer at
Myojo Asset Management Japan Co. “Are there that many people
buying TVs?”

The company reiterated its target for the TV operation to
post a profit this year after racking up 800 billion yen in
losses since 2004.

Hirai’s plan to revive the consumer-electronics business
focuses on games, cameras and mobile devices, including the
flagship Xperia Z smartphone revealed at January’s Consumer
Electronics Show in Las Vegas.

Smartphone Sales

Sony’s electronics operation will turn an operating profit
of about 100 billion yen this fiscal year, compared with a loss
of 130 billion yen a year earlier, Kato said. Smartphone sales
are expected to rise to 42 million units from 33 million units.

“Smartphones are going to start making contributions to
profit this year,” Kato said in Tokyo. “Xperia Z has been
getting great response from customers.”

Sony, Japan’s biggest smartphone maker, expanded its share
of the global market to 4.5 percent from 3.9 percent in the
final quarter of 2012, according to research company IDC. Sony
shipped 30.4 million units last year, compared with Samsung’s
218.2 million, according to Bloomberg Industries.

In February, Sony previewed the PlayStation 4 video-game
console that will go on sale for the year-end holiday season.
The company’s first home-gaming machine in seven years will make
its debut amid an industry shift toward games played on
smartphones and tablets.

PlayStation, Movies

Profit at the game unit will be “essentially flat” as the
company boosts spending on research, development and marketing,
it said. Sales will rise “significantly” on the introduction
of the PS4.

Sales of handheld players, including the PS Vita and PSP,
will probably fall to 5 million from 7 million, and camera sales
are expected to fall 20 percent to 13.5 million units, Sony
said.

The movies unit may post little changed earnings, Sony
said. The company’s Columbia and Sony Classics divisions have
garnered 7.4 percent of U.S. gross ticket sales in 2013,
according to Boxofficemojo.com, a movie research site.

Sony said it’s assuming exchange rates of 90 yen to the
dollar and 120 yen to the euro for the fiscal year. Each 1-yen
gain in the value of the dollar would erode Sony’s annual
operating profit by about 3 billion yen, while a 1-yen gain in
the value of the euro would boost profit by about 7 billion yen,
Kato said.